Quiz: quiz1 This Question: 1 pt A decrease in the price of a good will lead to:
ID: 1166753 • Letter: Q
Question
Quiz: quiz1 This Question: 1 pt A decrease in the price of a good will lead to: O A. a rightward shift of the supply curve for that good. O B. a leftward shift of the supply curve for that good. O C. a movement down along the supply curve for that good. O D. a movement up along the supply curve for that good. A decrease in production costs will lead to: O A. a movement upward along the supply curve. 0 B. a rightward shift of the demand curve for this good. ?. a rightward shift of the supply curve. 0 D. no change of the supply curve.Explanation / Answer
The law of supply tells that when there is an increase in price of a good other things remaining same, the quantity supplied of the good increases and vice versa. Thus when there is a change in price of a good there occurs movement along the supply curve. On the other hand when there is a change in other factors determining supply ( such as cost of inputs or production costs etc) there occurs a shift of the supply curve.
A decrease in price of a good will lead to
C. A movement down along the supply curve for that good.
A decrease in production costs leads to
C. A rightward shift of the supply curve.
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